This Overlooked Crypto Tax Provision Would Be a Disaster

The Breakdown

Nathaniel Whittemore

Investing, Business

4.8 • 786 Ratings

🗓️ 2 October 2021

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

This episode is sponsored by NYDIG. On this edition of “The Breakdown’s Weekly Recap,” NLW looks at: Hidden crypto tax provision 6050I Chilling language from British lawmakers around using CBDCs to control citizens’ spending The Compound political gaffe - NYDIG, the institutional-grade platform for bitcoin, is making it possible for thousands of banks who have trusted relationships with hundreds of millions of customers, to offer Bitcoin. Learn more at NYDIG.com/NLW. Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW “The Breakdown” is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Tidal Wave” by BRASKO. Image credit: Overearth/iStock/Getty Images Plus, modified by CoinDesk.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:16.2	The breakdown is sponsored by Nidig and produced and distributed by CoinDesk.
0:22.6	What's going on, guys? It is Saturday, October 2nd, and that means it's time for the weekly recap.
0:29.4	And today we are talking about a story which has been floating on in the background, but feels very important to highlight.
0:36.0	It is an overlooked crypto tax provision that could be an
0:39.0	absolute disaster for the industry. So to give a little bit of background, the story starts with
0:44.4	the infrastructure bill. If you remember, the infrastructure bill fight came to us when at the last
0:49.6	minute, the 11th hour, a provision was added as a way to pay for the infrastructure bill that set out
0:55.6	to close what they claimed were $28 billion of taxes that were avoided through loopholes in
1:01.5	crypto. The language of the provision was extremely broad and would have forced basically every
1:06.7	actor in the crypto ecosystem from centralized exchanges who make sense to be called brokers to
1:12.1	minors, to node validators, et cetera, to act like quote unquote brokers and report information that
1:17.8	frankly wasn't available to them about users of the network. It basically would have made it
1:23.1	illegal effectively to be a minor or a validator because as decentralized actors in the system,
1:28.5	as non-custodial actors, they don't have any of the required information that the government
1:32.9	was seeking about the people who are actually using the network. It was so egregious that
1:37.3	at first people in D.C. like Jake Trevinsky, who I had on the show a few weeks ago to explain
1:41.9	and recap the whole thing, thought it was a mistake. Turns out, it wasn't. It was a direct assault attack that seemed to be specifically
1:49.3	focused on defy, and as we would later find out, was being driven by and large from the not-so-invisible
1:55.4	hand of the U.S. Treasury Department, led by Janet Yellen. There is a lot to this story, but in short,
2:02.2	the crypto industry was able to put an incredible amount of pressure on the political process
	...

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